The portion of the population 65 years old and above is rapidly growing around the world, faster than any other age group. The year 2018 was the first time in history when seniors outnumbered children under 5 years old. By 2050, data from the World Population Prospects: the 2019 Revision estimates that about one in six people will be over the age of 65. Meanwhile, the number of people over the age of 80 is expected to triple from 143 million in 2019 to 426 million in 2050.
This is happening in virtually every country mostly due to the fact that all regions are now seeing longer life expectancy thanks to modern medicine. Many nations are also currently experiencing a decline in birth rates, contributing to an aging global population.
The aging global population has implications in all sectors of society, including healthcare and the workforce. For business, it might be good news.
Demand for Elderly Care
The aging global population will change the market significantly over the coming years as businesses try to meet the needs of the elderly population.
As seniors choose to continue living independently through old age, home health care has become one of the most profitable franchises in the United States. The demand for home health care is only expected to grow as more people reach their retirement years.
But, home health care will not be the only franchises that will flourish because of the aging global population. Services that provide support for the elderly will continue to be a necessity as adults grow older and begin to experience health issues that come with aging.
Now, therefore, is a good time to start a physical therapy business like Atlas Physical Therapy. Although physical therapy is more often associated among people who were seriously injured or have a history of prolonged illness, it could benefit the elderly, too. Seniors with mobility limitation, have had a stroke, exhibiting symptoms of arthritis, and other conditions common within the age group can take physical therapy as a non-drug treatment for their ailment.
A previous report predicts that, by 2030, more than 60% of Baby Boomers (born sometime between 1946 and 1964) will be dealing with more than one chronic condition. They will all need medical and non-medical care.
The Senior Spending Power
Baby Boomers are still the dominant age group when it comes to spending. In 2020, the above 50-year-olds are still outspending Millennials, currently the largest demographic in the labor force.
Baby Boomers, according to a report by VISA, make up more than half of the spending in the U.S. They are expected to continue to be a major force in spending in the next five to 10 years.
The Golden Years is no longer a time for retirement. Baby Boomers are staying in their jobs for far longer than their predecessors. Theirs is the only generation that is experiencing growth in labor force participation whereas other age groups are on a steady decline.
Experts predict that the global spending power of seniors will reach $15 trillion. Aside from the health sector, other fields are booming. From property investments to traveling, the aging population has their checkbooks out, ready to make expensive purchases.
The trend is observed in other parts of the world, too. Across the Atlantic, Britain’s aging population is on a spending spree, fueled by a generous final salary pension and wealth from entering the real estate industry early. The Grey Pound, which is the money the elderly spend, is worth over £320 billion a year and the aging population is pouring it onto holidays, properties, fitness, entertainment, private care, etc.
Challenges of an Aging Population
However, it will not be raining money at all times. Although Baby Boomers are staying in the labor force longer, eventually they, too, will have to retire. An aging population means that, as older folks leave, the pool of talent grows smaller.
Japan is already seeing the impact of an aging population. By 2040, it is predicted that the nation’s labor force will shrink by as much as 20%. The birthrate in Japan has been reducing for years and the economy is increasingly becoming dependent on migrant workers.
Other developed nations are facing the same issues. Neighboring South Korea is seeing a significant population decline. Poland is expected to have over 50 make up have of its entire population by 2050.
The aging population, and a limited pool of talents, could lead to higher wages in the future as businesses compete for employees.
For the first time, the world has to deal with an aging population and it will change the market significantly in the near future. Businesses should be ready to adapt to whatever shifts take place.